Thais borrow early and get trapped in a cycle of debt

[DrTuner]

2 minutes ago, Number 6 said:

Poor people don't need half that crap. Refrigerator is cheap and lasts decades.

 

Very simple rooms with AC 20 minute walk to MRT can be had for 3500b.

 

A roof? That's a splurge? A toilet? C'mon

Phah, all you need is a tube of bamboo to go hunt in the forest. A house, what an unnecessary luxury. We should all save the planet and return to stone age right now.

[lootarzoon]

15 hours ago, dcnx said:

The music will stop eventually.

 

I’m absolutely shocked to hear people making 9000 - 15,000b per month can’t afford a new car and the latest iPhone.  

My cook good chef get 27000 month, soon bought nice new car at highest unknown in occident bank interests rate, surely spend more than half of his income  for being a nice limousine car owner... + his rental for housing and family care, always on the run to find sides incomes... 

[FarangULong]

4 hours ago, UTH001 said:

Reason for high household debt (also compared to GDP) in developed countries, such a Switzerland and Australia? Mostly due to high mortgage debt, which is not really a huge concern as property values have remained high and quite steady for at least the last decade...

 

Exactly. In fact in my country (Austria) the real estate price per squaremeter is steadily rising. I, for example, live in a small town (under 4000 people), and here it ranges from 115 (those in the 2nd part of the town, as the town grew together from two villages, ages ago) to 220 euros. The house and land I have was originally bought by my parents (inheritance) for 2,5 million Schillings in 1996, or thereabouts. 1 Euro is = 13,7603 ATS (or roughly 7 ATS equalled one Deutschmark) plus 33 years of inflation... Austria is fast catching up with JAPAN in terms of living space prices. On an index I recently saw Japan was at 12 something, whereas Austria was at 10 something. Where I am it is around 200 euros per m² (steadily rising). So just from the land price alone, MORE than 50% of the then buying price is already covered..

 

We also have some of the best quality drinking water coming from our taps, and just like in Switzerland etc. most of the household debt is due to mortgages, but ofc you do have the idiots (esp. certain nationalities/ethnicities) who make their 4 kids sleep in one room, so daddy can drive the brand new Mercedes/BMW/Audi with all the extras, but at least working a lot of extra shifts and overtime, in order to pay for it and still take the kids on holiday (and in many cases buy land and build estate-esque households in the country of origin) in some of these cases also..

 

And yes, young people especially love to max out their credit, buy new phones at least twice per year, etc. All for instant gratification. But they also don't come out of university with at least 100k in debt just for their education (then again our Unis aren+t even in the top 100 worldwide, and continue to tumble in the rankings year after year also), like in the US or with about 20-50% of that in the UK.

 

So hardly the same as Thais.

[Almer]

4 hours ago, wolf81 said:

Also might mean farangs will be able to buy some cheap land for the wife, due to people forced to sell in order to pay back their debts. 

The full circle is almost complete, when the Thai people get refused more loans to pay other loans they will sell everything, cheap, very cheap

[malibukid]

10 hours ago, khunpa said:

The big difference is that Thailand has no welfare system.

why is that?

[ExpatOilWorker]

11 hours ago, Yinn said:

Farang mentality so clever?

 

Household debt to gdp.

 

thailand 78%

australia 120%

denmark 115%

canada 101%

swiss 129%

norway102%

new Zealand 94%

uk 95%

ireland 117%

 

 

 

You will find that some of these farang countries have massive pension savings to mirror their household debt. Pension savings in Thailand are....well not very big.

 

Denmark holds the world record in saving for old age. According to figures from the intergovernmental economic organisation OECD, Denmark had pension savings totalling DKK 4,315 billion (EUR 579.7 billion) last year, equal to 209 percent of Denmark's gross domestic product, according to Danish business daily Berlingske Business.

 

https://amwatch.dk/AMNews/Pension/article10004976.ece

[Yinn]

1 hour ago, HeyHeyHey said:

Are you just stupid 

 

AND most of the debt in foreign countries are mortgages. But not for tiny shoeboxes that are low quality and close to impossible to sell, or rent (to get reasonable ROI) like in Thailand.

I not stupid to pay this....

 

https://www.domain.com.au/news/ten-of-the-most-rundown-sydney-dump-houses-sold-in-2017-20171230-h05aed/

 

great quality!!! 5555555555

wonderful!!!

[Yinn]

5 minutes ago, malibukid said:

why is that?

Because no unemployment.

dont need.

[malibukid]

heres the deal, humans think they need all this junk to make them happy.  guess what, it's just a short term fix like herion

Edited August 13, 2019 by malibukid

[Ctkong]

2 hours ago, Vacuum said:

Throw in a maid and your'e all set. Question is, what will you do with your "free time", sleep?

Take the time to smell the roses. See the world through the eyes of a compassionate person . Travel widely. Traveling opens not only the eyes but also the stereotyping mind set. You get to see with your very own eyes the basic essence of human beings. Do self cultivation in your own home in a serene,safe and comfortable place without going all out to be an ascetic monk. With mundane jobs being freed up, there are ample time to do that. Use the time wisely for time waits for no one. 

[Ctkong]

10 minutes ago, ExpatOilWorker said:

You will find that some of these farang countries have massive pension savings to mirror their household debt. Pension savings in Thailand are....well not very big.

 

Denmark holds the world record in saving for old age. According to figures from the intergovernmental economic organisation OECD, Denmark had pension savings totalling DKK 4,315 billion (EUR 579.7 billion) last year, equal to 209 percent of Denmark's gross domestic product, according to Danish business daily Berlingske Business.

 

https://amwatch.dk/AMNews/Pension/article10004976.ece

Thais and people in other Asean countries are more pragmatic. They cannot depends upon the country pension plan to finance their retirement unlike the politically more stable western countries. The ASEAN pension might not be there when they need it. So they do the next best thing. Self finance with assets bought in installment which is indirectly a savings program thus the higher household debt to gdp ratio. 

[Bangkokazy]

21 minutes ago, ExpatOilWorker said:

You will find that some of these farang countries have massive pension savings to mirror their household debt. Pension savings in Thailand are....well not very big.

 

Denmark holds the world record in saving for old age. According to figures from the intergovernmental economic organisation OECD, Denmark had pension savings totalling DKK 4,315 billion (EUR 579.7 billion) last year, equal to 209 percent of Denmark's gross domestic product, according to Danish business daily Berlingske Business.

 

https://amwatch.dk/AMNews/Pension/article10004976.ece

 

 

Edited August 13, 2019 by Bangkokazy

[Ctkong]

2 hours ago, Hank Gunn said:

Not sure about Thailand, but in the US it would be difficult for banks to garnish wages from credit card debt. Typically, banks with credit card loans that can't be collected either write them off as NPLs (Non-Performing Loans)/a loss or they sell them off to specialized debt collectors for pennies on the dollar. The debt collectors then gamble/bet on being able to collect from enough of the "dead beat" loans to make back their investments, plus a small profit. I've never heard of credit card debt being paid off through garnished wages, as typically debtors will have gotten so far in debt with collateralized loans (i.e. houses, cars, boats, etc.) that the credit cards are typically at the end of the line of debt collectors. Typically, employment details are only provided as evidence of being able to pay off your debt.

 

Having said all that, I have no idea what the credit laws are in Thailand (especially since Thailand isn't really known as a place with the rule of law). I only have two accounts here, one for my 800k (a fixed dep. acct.) and one for day to day expenses. All my other banking is done/kept in my home country (US). I've also never borrowed money on a credit card (always pay off the balance every month) as that's probably the worst way to borrow money outside of a loan shark.

I am not sure about Thailand but Malaysia and Singapore has government agency that help those credit card debtors that are unable to pay their snowballing  debts. What they tried to do is to get both affected parties to sit down and work out a payment plan that is more realistic and feasible. The creditor bank may waive certain charges , lower interest rate , lengthen the repayment period while the debtor while trying to avoid bankruptcy would comply with the plan and having a certain amount of his monthly pay being docked.

[Sujo]

1 hour ago, DrTuner said:

Phah, all you need is a tube of bamboo to go hunt in the forest. A house, what an unnecessary luxury. We should all save the planet and return to stone age right now.

Well im not a greenie but have never had a loan or insurance in my life. If i cannot pay in cash i dont buy. For insurance i get a quote and put that amount in my seperate account.

 

i must say Im very well off not having those things. Havent heard of an insurance company or a bank doing it tough.

[elliss]

15 hours ago, Tayaout said:

I paid my wife credit card. In exchange she had to surrender it to me. What is ridiculous is that she maxed it buying gold for her family. At least gold is up. ????

 

  Not to worry matey , she will have a new credit card soon.

    Farlang can take of thai lady debt , no problem , big money ..

 

[Puritan]

Thais are no different to the younger generation in the western world, buy now pay later. My father taught me a hard less when I wanted to borrow £25 in 1965 to insure my first car, he simply said, "no I'm not going to lend you the money, if you can't afford it then don't have it and take my advice don't go around borrowing of friends or banks, work and save for what you want." I hated him for it but took his advice which has stood me in good stead to this day.

By coincidence I was discussing the problems of the borrowing habits of some Thai families going to money lenders or shall we say loan sharks and losing their land because they can't repay without borrowing more.

[tabarin]

9 hours ago, OttoPollmann said:

To all these thai apologizer that all these pesky Farangistan countries are in debt too.
What everyone of these guys have forgetten, the system how these countries work require that you need to have debt.
To get a tax rebate it is preferable to have some long term loan on a house. This is forward planing and if it is properly calculated at the retirement age you are debt free and your house is partly paid by the tax rebate.
Or how you thing big global companies pay no tax at all. They writing of some debt and loss.

 

You have something comparable in Thailand? I don't think so.

Have a look to all those farmers. They are all in debt. Every year at the time they have to pay back the loan to the farmer's bank. Then you can see them to borrow money just for one day and if they are lucky, they pay just 5% for this day. On the next day they will re-new a loan again from the bank for another year.
This is a fatal cycle where it is almost impossible to escape and they cannot claim private bankruptcy like in these pesky Farangistan countries.

The only way out is by suicide. Think about it you apologizer.

So true. Not even close to comparison, maybe to the US but not other western countries.

In Netherlands / Europe at worst you got a student debt (with low interest and low installments over 30 years up) and a credit line of maybe 2000 euro max.

And then again, they earn also much more in comparison to their Thai counterpart work slaves.
Not sure how one even dares to compare this to foreign countries or individuals their perspective, in western it is about luxuries, not basic life as it is here.
Oh, I will not even start about all other benefits most westerners enjoy while paying those similar bills too (educated, healthcare, social housing, etc etc).

If you want to match Westerners with Thais, you can talk about them being lazy on average, nothing else.
In the western world it never been easier, neither there been so many options; it is just lazy fks watching netflix all day and gaming that is the problem there.

Bottom line: The Thais that are in debt, are in debt by factor 50-100 in terms of what they earn and owe, compared to most westerners (except maybe US).
The real shame to all nationalities and people of every generation is their absolute ignorance and limited knowledge about finance and money.

Oh and try to go bankrupt in Thailand to start with a clean slate after 3-5 years, no way, but in Europe you can.

Edited August 13, 2019 by tabarin

[tabarin]

3 hours ago, Number 6 said:

The difference here is the laws greatly unfavor borrowers and being Thai not educated and largely unsophisticated in terms of finance. They want. Impulsive. Most likely trust predatory lenders.

 

Looking at my wife's parents you'd think they don't have one satang to rub up against another. Two modest homes, townhouse near Hualalongpong. Tiny restaurant, a taxi and a car. Cash in bank I suppose. They're all about cash. Old school.

 

Wife is same. No debt. We spend too much money on trips but she still has about 500k plus a small house upcountry bought from a relative cheap.

 

I really feel sad for all those Starbucks drinking fabulous fashionistas but bless all the pretty girls in nice clothes and makeup. Keep spending!

Sounds like you are talking about my wife, all though, she still needs to finish the education debt, which is assured to be done soon.
But in terms of clothes or make-up, that is not expensive at all here (we just think that because of the costs back home), it is more a matter of style.

Edited August 13, 2019 by tabarin

[Bangkokazy]

Average Monthly Net Salary in Thailand is After Tax 19,788.82 ฿
Mill Cooperative Suvarnabhumi. Bangkok Suvarnabhumi. 1 tonne of rice is THB 16,500 ฿
fishing heads cat and dog are free ... hehehe

so thais have more than pay to pay their loans ..
Remember that the Thai have farang friends in the West who help it with their loans ..

[maddox41]

I look around here and see all  these people with all the Hiso bling but behind doors most live in a 23 sqm apartment in debt to the eye balls can't rub two sticks together  But in public  or at work their  the bomb!!! And the attitude oh man  I'm a little hiso.....NOT 

 

This country is on its way down a very slippery slope with nothing to grab onto.

 

 

[Selatan]

In Malaysia, there is a popular ethnic Malay saying "Biar papa asal bergaya". Roughly means "It's okay to be penniless, as long as we have style." Do they have a similar saying among the Thais? The ethnic Chinese in Malaysia don't have this saying in their culture. Not sure about the Thai Chinese.

[tabarin]

37 minutes ago, Bangkokazy said:

Remember that the Thai have farang friends in the West who help it with their loans ..

Correction: They used to have friends in the west, those friends are no longer reachable due to the forex lol!

[Jonathan Swift]

19 hours ago, ezzra said:

Inherently, Thais mentality is 'Let's spend now and think how to repay it later' are also bad at money managements, loyalty  and diligence to a workplace not to mention honesty, plus their family commitments to help each other at all time, so no wonder most thais are cashless and wanting, and the never ending chase for luxury items puts them in the hock even further...

This is absolutely not just "Thais mentality". It's pretty much everyone in the eastern and western world as well who wants but cannot afford the things they see in adverts and in the hands of all those around them

[ThomasThBKK]

4 hours ago, Bangkokazy said:

 

 

 

Congratulations, you didn't manage to comprehend what he talked about at all.

 

He talked about the Pension/Wealth fund sizes compared to debt and GDP: https://www.atlas-mag.net/en/article/pension-funds-in-2017-the-powerful-rise#targetText=Pension%20funds'%20Assets%20%2F%20GDP%20in,43.4%20trillion%20USD%20in%202017.

 

As you can see countries like Denmark have giant pension funds, x times the amount of their debt.

Which makes them look overall very healthy, there are some countries like germany that don't have giant pension funds, they store their assets in different vehicles, that's why.

 

Quote

Germany’s net external assets, ie residents’ assets minus liabilities vis-à-vis non-residents, in relation to the nominal gross domestic product (GDP), grew from just under 20% at the start of 2007 to around 60% by the end of 2017, with external assets standing at €8,346 billion against liabilities of €6,417 billion

SRC: https://www.bundesbank.de/resource/blob/732996/2a932aa105a9bb491de40b1636e4fc04/mL/2018-04-auslandsvermoegen-data.pdf#targetText=Germany's%20net%20external%20assets%2C%20ie,liabilities%20of%20%E2%82%AC6%2C417%20billion.

 

This means germany is actually quite healthy too - more asset value than it has liabilities. Net assets reaching around 50% of GDP. 

 

Couldn't find numbers for Thailand tho

[onera1961]

3 hours ago, tabarin said:

Oh and try to go bankrupt in Thailand to start with a clean slate after 3-5 years, no way, but in Europe you can.

Over the last thirty years I have amassed 67 credit cards with available credit close to half a million. In the US, creditors or bankruptcy court cant touch your SS. Access to half a million dollar credit is very liberating. I'm tempted to spend 50% of my available credit and declare bankruptcy after I start drawing SS.

[Bangkokazy]

35 minutter siden, ThomasThBKK sa:

 

Gratulerer, gjorde du ikke klarer å forstå hva han snakket om i det hele tatt.

 

Han snakket om Pension / investeringsfond størrelser i forhold til gjeld og BNP:  https://www.atlas-mag.net/en/article/pension-funds-in-2017-the-powerful-rise#targetText=Pension%20funds '% 20Assets% 20% 2F% 20GDP% 20in, 43,4% 20trillion% 20 USD% 20in% 202017.

 

Som du kan se land som Danmark har gigantiske pensjonskasser, x ganger mengden av gjelden sin.

Som gjør dem ser generelt veldig sunt, er det noen land som Tyskland som ikke har gigantiske pensjonskasser, de lagrer sine eiendeler i ulike biler, det er derfor.

 

SRC:  https://www.bundesbank.de/resource/blob/732996/2a932aa105a9bb491de40b1636e4fc04/mL/2018-04-auslandsvermoegen-data.pdf#targetText=Germany's%20net%20external%20assets%2C%20ie,liabilities%20of% 20% E2% 82% AC6% 2C417% 20billion.

 

Dette betyr at tyskland er faktisk ganske sunt også - mer verdijustert egenkapital enn det har gjeld. Netto eiendeler nå rundt 50% av BNP. 

 

Kunne ikke finne tallene for Thailand tho

https://www.bot.or.th/Thai/MonetaryPolicy/ArticleAndResearch/FAQ/FAQ_143.pdf

 

Edited August 13, 2019 by Bangkokazy

[dallen52]

Thais borrow anywhere. 

With minimal thought and commitment to repay.

 

Especially if they have a friend who has a farang partner. 

 

Money lending is a daily activity.

20% is common as a charge. 

I know several thai people who are doing this. Its business to them. 

 

20 or 30% doesn't phase them, because they usually borrow more to pay what they already borrowed.

 

My partner is currently owed a few baht. (Several thousand).

And under the threat of separation from me.

If anyone trys to borrow her again. 

 

Classic example. 

Partners son takes a brand new 125 bike on the never never. At 1%.

(The bike shops are as much to blame as anyone else)

Puts it in the wife's name to register it locally. ID card etc.

Partners sister in law stands guarantee. (No idea why?)

The two of them (her son and wife) move away, her family were to make the monthly payments.

You guessed it, no payments are made by them. 

5 months default payment owed.

My partner jumped in, sold some gold, gets the repossessed bike back, and gives to her daughter. 

To go to high school on.

Then she commits to the 1700  month ongoing payments. 

For God knows how long...

 

And no discussions entered into. 

 

And they don't see anything wrong with that...

They really don't care.

[Melbun]

13 hours ago, kiwikeith said:

There is a lot of written off debt in LOS.

I have family members that keep buying new cars and bikes with different guarantors .

I don't know how they do it, they loose one car to repossession, then bingo they get another one a few months later.

Apparently there is a large volume of repod cars stored in LOS.

Strange that the house prices seem to be rising, I don't know what sales are like , all I hear is expats are leaving in droves.

All those empty condos on the Cha Amm coast line will soon be full of Chinese owners flocking into Thailand to retire live.

Thailand is in danger of being under complete Chinese control very soon.

I think it already is.

Falangs are not wanted now.

There will be lots of bars for sale in the future, and the future of the bar girls may be dwindling.

Crime rates will rise, this runs with debt, banks are only to happy to enslave people.

This is the way of the world now, pathetic but true,people just have to have an iphone and a car and financiers love to provide the funds.

No, I don't think it will be over run by Chinese. The Thais still have a semblance of sense. And the communist government aren't about to let go of it's citizens. Tour groups yes, permanent Chinese residents NO.

[Melbun]

14 hours ago, Fred white said:

Actually banks already charge for keeping our money if you don't have direct deposit or keep a minimum amount

And this mentality of thinking of the inevitability of a cashless society should stop. Ditch the plastic metaphorically - start using cash where possible. In a cashless society we relinquish control of our money to banks and government. AND anyone that wants to spy on our every movement.

[mania]

12 hours ago, Ctkong said:

Living debt free but without modern amenities is not living. Think of amenities such as air conditioning, plumbing, roofing , refrigeration, washing machine, oven, dishwasher ,cars, bikes, auto garden watering system, tv electronics... all strive to free up people from doing mundane work day in and out while letting them enjoy their free up time with all that life can offer. However the caveat is that you must have financial freedom to do all that. 

I know that was probably tongue in cheek but......

 

Not at all as I never said live poorly I said live debt free.

 

Perhaps many are too young to remember but that was how it was even decades ago in America.

The only debt folks had was a mortgage & they threw every extra penny against it till it was gone & then had a mortgage burning party.

 

Living debt free is not hard it is just not buy now & pay later easy mentality

 

Instead it is save for what you want/need.

Seriously half the time it saves you from buyers remorse as when you save the money many times you later decide nah...don't need that.

 

When I was young I would watch my mom buy things on what they called "Lay Away"

She would pick what the item was say a washer or appliance...Set it on Lay Away with a deposit then make what ever payments she wanted to or could

As long as something went on the bill monthly no matter how big or small all was fine.

No Interest was charged & when paid off item went home with her 100% paid for.

 

You know Central Bankers started all this nonsense of buy now pay later & all we want is a tiny interest rate (usually payment is smaller than your monthly interest total).

Because truthfully they don't want to be paid back...no they want you to turn that wheel of interest instead & let balance grow!...Free Money for them

 

Or maybe it is all Wimpy's fault from Popeye with his

" I will gladly pay you Tuesday for a Hamburger Today"  ????

Edited August 13, 2019 by mania